Passage of health overhaul draws cheers, jeers in Indiana [The Indianapolis Star]

Dec. 25--Many of Indiana's big health-care companies -- such as Eli Lilly and Co., Zimmer, WellPoint and Cook Medical -- made progress in the health-care debate, but none of them came away complete winners Thursday when the Senate passed a sweeping reform measure.

The bill could usher in near-universal medical coverage for the first time in the country's history and marks a triumph for President Barack Obama.

Some of Indiana's biggest and most influential health players, however, face higher taxes and more regulation. Several expressed uncertainty about whether the bill would help the country's strained health-care system.

The 60-39 party-line vote in the Senate came just weeks after the House passed its own reform measure. Now the debate is likely to continue for months as the chambers hash out big differences in their bills, many of them considered critical for the health industry and for a broad array of interest groups and ordinary citizens.

The differences include such contentious issues as coverage for abortion, federal subsidies for lower- and middle-income families and whether the government will offer a public insurance option.

At the White House, Obama called the vote historic and said because of it, "we are incredibly close to making health insurance reform a reality in this country. Our challenge now is to finish the job."

Groups representing drug makers, doctors, low-income residents, device makers and senior citizens cheered the bill. Others, representing insurers, small business, health underwriters, nursing homes and pharmacy benefits managers, opposed it.

For drug makers, such as Indianapolis-based Lilly, the Senate bill represented a victory. The industry beat back attempts to let consumers import cheaper medicines from other countries, such as Canada. Meanwhile, drug makers could see sales rise, as more Americans get access to health care.

"Eli Lilly applauds the Senate for taking an important and historic step toward expanding high-quality, affordable health-care coverage and services to tens of millions of Americans, many of whom are struggling today financially," the company said in a statement.

Some advocacy groups, including AARP and the American Medical Association, which both have large memberships in Indiana, backed critical provisions of the health-care bill, including the expanded coverage to millions of Americans and elimination of insurance denials based on pre-existing conditions.

Medical device makers, including Cook Medical in Bloomington and orthopedic makers in Warsaw, failed in their bid to eliminate new taxes but won a big reduction in the proposed tax, to $20 billion from $40 billion, in the Senate version.

Hospitals, for their part, seemed to come out with a slight benefit. They agreed to reduced payments from Medicare and Medicaid in exchange for what some think will be a boost in insured patients.

"While we are pleased to see an increase in access to insurance coverage contained in the Senate bill, we have deep concerns that the legislation still does not do enough to reform health-care delivery for patients or bend the total cost curve," said Dan Evans, president and chief executive of Clarian Health, whose hospitals include Methodist Hospital, Indiana University Hospital and Riley Hospital for Children.

And some groups representing low-income residents cheered, even though the Senate bill does not include a public option, a measure that some supported.

"Getting some coverage for some people is better than nothing at all," said Booker Thomas, president and CEO of HealthNet, a network of clinics for those with low incomes and the uninsured. "We are just happy and elated that more people will not have to go without health care, which is so important."

The big losers, at the moment, seem to be insurers. Although they stand to provide insurance to nearly all Americans, because the Senate bill does not include a government insurance option, they will face tighter regulations and higher taxes.

Shares of Indianapolis-based WellPoint, the nation's largest insurer by membership, dropped 1.1 percent Thursday. Other insurance companies, including Humana and Aetna, also saw their stock price fall. WellPoint officials could not be reached for comment Thursday. But they, too, scored a victory when the public option was dropped from the Senate version.

Senate Republicans attacked the bill to the end and, citing public opinion polls, said they would use it as an issue in the 2010 congressional elections.

"This debate was supposed to produce a bill that reformed health care in America. Instead, we're left with party-line votes in the middle of the night, a couple of sweetheart deals to get it over the finish line and a public that's outraged," said the Republican leader, Sen. Mitch McConnell, R-Ky.

The Senate vote unfolded as the sun rose over the Capitol on Christmas Eve, marking the culmination of a months-long battle that included failed bipartisan negotiations, a last-minute flurry of Democratic deal-making to lock in 60 votes and a highly partisan debate that held lawmakers in session a near-record 25 consecutive days.

Beginning in 2014, the Senate bill would establish insurance exchanges where consumers could shop for private coverage sold under federal guidelines. Most Americans would be required to purchase insurance or face penalties, and hundreds of billions of dollars in federal subsidies would be available to families with incomes up to about $88,000 a year. Insurance companies would be banned from denying benefits or charging higher fees on the basis of pre-existing medical conditions. That provision would take effect in 2013 in the House version.

The Congressional Budget Office estimates the Senate measure would cut federal deficits by $130 billion over a decade and possibly much more in the following 10 years. Premiums would rise for some but fall for many others, particularly when the effects of federal subsidies are factored in, the agency says.

Literally hundreds of issues remain to be settled in the two bills, a House measure that ran to 1,990 pages and a Senate version of 2,074, not counting 383 pages of revisions that Majority Leader Harry Reid, D-Nev., unveiled over the weekend.

To finance extended coverage, the House bill would rely on an income tax surcharge on incomes of more than $500,000 for individuals and $1 million for couples, a provision the Senate omitted. Its bill includes higher Medicare payroll taxes on high-wage earners and a new tax on high-cost insurance policies that labor unions generally oppose.

Medicaid, the federal-state health-care program for the poor, would expand in both bills, but the House version includes many more people. The House bill also requires large employers to provide insurance to their workers or pay a fine. There is no such mandate in the Senate bill, although companies would face penalties if any of their uninsured employees qualified for federal subsidies to purchase their own insurance.

The House-passed bill is estimated to extend coverage to 36 million people over a decade, the Senate measure to 31 million.

Both bills rely on hundreds of billions of dollars in cuts in future payments to doctors, hospitals and others who care for Medicare patients, with the largest reduction falling on insurance companies that provide a private alternative to traditional Medicare.

Sen. Richard Lugar, R-Ind., who repeatedly has voiced his opposition to the bill, did so again this week. He criticized the way it was passed -- without an opportunity for Republicans to offer amendments -- and said the reform is likely to do more harm than good. It will limit health care for many Americans at a greater cost to all Americans as deficit spending increases dramatically, he said in a statement.

"Health-care reform legislation debate began with three main goals: to cover almost all Americans, to reduce health-care costs and to not increase federal deficit spending," Lugar said. "This bill fails on all three of those goals."

Instead, Lugar suggests exploring inexpensive, incremental improvements.

Sen. Evan Bayh, D-Ind., agreed the measure is "far from perfect." But he said that doing something to improve the health-care system is better than doing nothing.

"This legislation, despite all its flaws, prohibits insurance companies from denying Hoosiers coverage because they have a medical condition," Bayh said in a statement. "It prevents insurance companies from dropping people from their coverage because they become seriously ill. It limits the fees that insurance companies can charge consumers. It expands Medicare benefits so seniors can afford the prescription drugs they need. And it ensures that everyone can keep the right to choose their own doctor."

The Associated Press and Star reporters Shari Rudavsky, Robert King, Erika D. Smith and Maureen Groppe contributed to this story.

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